California to spend big on education, healthcare in $144 billion budget

Newsom unveils a $209-billion budget to boost schools and healthcare and fight poverty

Newsom unveils a $209-billion budget to boost schools and healthcare and fight poverty

California Governor Gavin Newsom capped a busy first week in office on Thursday by proposing $144.2 billion in general fund spending for the most populous USA state, highlighted by increased expenditures in healthcare and education.

The extra $6 billion gives Newsom room to spend more on health care, education and housing.

Newsom has made early childhood education a central focus of his new administration. Lawmakers have until June 15 to approve a balanced spending plan or lose pay.

Newsom's fiscal blueprint assumes continued economic growth of at least 3 percent a year but cautions a recession could transform an existing budget surplus of more than $21 billion left by his predecessor and fellow Democrat, Jerry Brown, into a $40 billion deficit over three years.

The new governor's budget devotes $13.6 billion of the windfall to build the state's reserves and to pay down state debt and growing pension liabilities.

Newsom will unveil his spending plan at 11 a.m.at the California Secretary of State's auditorium in downtown Sacramento.

His proposal would use $4 billion to pay off debts accumulated during the Great Recession as the state borrowed from dedicated funds, including transportation accounts, to pay for general expenses. He also plans to increase funding to provide full-day preschool and kindergarten to all children. And he's calling for boosting a tax credit for the working poor by a total of more than a half-billion dollars. Nearly all of the projected $2.3 billion in higher state spending for schools, for example, is driven by California's constitutional requirement governing education finance.

He's proposing $60 million this year and next to improve emergency communications, and seeking a new fee on consumers to generate $170 million annually.

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The latest Budget has a focus on "cradle-to-career opportunities" which will help children and their parents with investments in areas such as childcare and education. California is experiencing a major affordable housing crisis, with prices and rents rapidly rising while the number of available homes remains far below the need. He proposes withholding money if local communities don't meet their housing goals or stand up homeless shelters. That proposal may be controversial in the Legislature.

Newsom has also proposed expanding state-funded health care to low-income people living in the country illegally until their 26th birthday, up from a current cutoff at age 19.

With additional bond fund revenue and "special fund" allocations of $64.8 billion, total state spending proposed by Newsom for the upcoming fiscal year that begins in July would come to $209 billion.

Newsom also plans to increase subsidies for people who buy their own insurance, rather than getting it from an employer or government program. His health proposals would cost $760 million a year.

And he plans to propose a significant expansion of California's paid leave program, which allows new parents to receive a portion of their paycheck while away from work following the birth or adoption of a child.

Gavin Newsom, the newly sworn-in governor of California, unveiled his first budget on Thursday-and it includes an eye-catching proposal to expand the Paid Family Leave program in the Golden State, which could see it become the longest in the U.S.

Under the new proposals, the length of the family leave program could eventually be extended up to six months, bringing California more in line with the majority of OECD nations on this issue.

The current leave program is funded through payroll tax, but it is now unclear exactly how the expanded program will be paid for, The Hill reported.

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